Archive for May, 2009

Which Vauxhall plant will close?

Friday 29 May 2009

Tony Woodley’s at it again.

Three months ago, he predicted that a UK motor factory was on the brink of collapse. The Sunday Times claimed it was Vauxhall’s Ellesmere Port, just days after I said the plant wouldn’t close. In the end, it turned out to be LDV that was in trouble.

Now, the Financial Times is reporting that Unite union officials are saying that Woodley – who himself used to work at Ellesmere Port – fears one of Vauxhall’s two plants in the UK will have to close as a result of the likely takeover of General Motors Europe.

Lord Mandelson is predictably unhappy. Well, there’s no love lost between him and Woodley – who once called for Mandelson’s fellow Blairite and predecessor John Hutton to be sacked.

Anyway, which plant has Unite sounded the death knell for? Despite Woodley’s links to Ellesmere Port, my money’s on Luton. Ellesmere Port has only just been kitted out to build the new Astra from September. Luton, on the other hand, produces the Vivaro, a large van… which is what LDV made.

The NEC may be the key

Wednesday 20 May 2009
Ellie Reeves (right), with sister Rachel and friend

Ellie Reeves (right), with sister Rachel and friend

I was surprised today to take a phone call from Radio 4’s The World at One asking for Ellie Reeves’ phone number. It’s not every day that the media try to hunt down members of Labour’s national executive committee. But they did rather find themselves at the centre of a political storm this week, as the Labour Party’s sovereign body, when Gordon Brown stuck a proposal for dealing with MPs with dodgy expenses in front of them and got them to approve it.

Keen readers of this blog (both of you, in fact) will know the last time NEC members were being rung up by journalists far more important than me. Yes, it was when there was talk about calling for Brown to be re-nominated as party leader every year. That wasn’t a welcome story for No 10. And this one is far, far less welcome. The NEC only becomes important, it seems, when things aren’t going well for Labour.

What’s fascinating about the current crisis of confidence in MPs in general, and Brown in particular (witness his poor poll showing) is it gives the NEC two important roles to play.

One is the official role as the party’s decision-making body. The fate of errant MPs like Elliot Morley and David Chaytor now lies in the hands of just three NEC members – chair Cath Speight, Ann Black and Ann Lucas (standing in for Jeremy Beecham). They will turn their thumbs up or down at these wounded gladiators.

The other role is as a conduit for grassroots Labour views. That’s what’s happened this week, when Ellie Reeves took the views of hundreds of activists (who really are quite angry/unhappy) into that room at Portcullis House and tried to get the proposals changed. And when it failed, she came out and told them all about it. Which is where the BBC came in.

This is serious stuff. When Tony Blair was leader and Mark Seddon sat on the NEC, he described it as being turned into Blair’s Praetorian Guard: an ultra-loyal corps of unquestioning defenders. It’d be hard to call them that now. Brown is vulnerable. Organisations which have both grassroots support and the leaders’ ear are uniquely positioned to seize the initiative. If the NEC is successful in detoxifying the expenses issue, Brown will be safe – and they will fade back into the shadows. If not, he may find himself handbagged by those unpaid, expenses-free activists.

NEWSFLASH: Speaker will resign at 2.30pm today

Tuesday 19 May 2009

No-one else seems to have the time just yet, so thought I’d put it up. Please credit me if you use it, thanks.

Expenses: In the name of Gord, go

Tuesday 19 May 2009

Today Labour’s National Executive Committee meets to discuss dealing with expenses-happy MPs; I hear that Gordon Brown is going to be there (and not from one of the NEC, in case you’re wondering). Meanwhile the 33 NEC members have been deluged with thousands of emails from party members offering demands, suggestions and protestations about the conduct of their elected representatives.

The Prime Minister’s presence makes it likely that he will want the party, and the public, to see him as coming away from this meeting with a firm decision – his decision – on what to do. Expect the NEC to be given a plan of action and told to vote for it. No doubt it’s hoped that this will redress the balance between him and David Cameron, whose early apology and pledge to make MPs repay money has favoured him in the polls.

What are they going to decide? Two ‘extreme options’ can probably be ruled out. The first is to reselect all MPs, regardless of whether they’re under suspicion or not. The second is only to reselect an MP if the parliamentary standards commissioner decides they’re guilty of deliberately making an unjustified claim. The trouble is, how can you prove that? Will many MPs be caught out that way? I doubt it. In which case it’ll be seen as a get out of jail card for MPs, and Brown won’t get his positive headlines.

The NEC is moving towards approving guidelines for individual constituency parties to rule on whether they should try to reselect their MP (as reported in today’s Guardian). Of course, Labour’s high command isn’t going to leave it all to the constituencies to decide. But party activists and the NEC both want the power to be devolved to the grassroots.

Meanwhile, Brown faces the thorny problem of how to crack down on all MPs equally when that risks impacting on your own cabinet. How to deal with Hazel Blears’ dodgy second home claims and Jack Straw’s council tax bonanza? Perhaps the above solution is the neatest one. Is a constituency party likely to tell a cabinet minister they’ll be out of a job come June 2010, mindful of the violence that will wreak on the Westmnister scene and the humiliation it will cause for Labour? I doubt it. In which case maybe there will end up being one rule for ministers and another for backbenchers after all…

But I don’t know. We’ll see. Labour hasn’t planned a press conference for today. But keep your eyes glued to the TV.

Will Brown move on tax havens?

Friday 15 May 2009

431px-SiegeOfAcre1291An edited version of this post appears on Liberal Conspiracy.

“We agree… to take action against non-cooperative jurisdictions, including tax havens. We stand ready to deploy sanctions to protect our public finances and financial systems. The era of banking secrecy is over. We note that the OECD has today published a list of countries assessed by the Global Forum against the international standard for exchange of tax information.”

Those were the stirring words of the G20’s London Summit communiqué last month. In advance of the summit, Gordon Brown was keen to put himself at the vanguard of the heroic frontal assault on those sun-kissed foreign resorts. “Old tax havens and the regulatory havens have no place in this new world,” he declared. So is his government going to start cracking down on tax havens?

I’ll come to the G20’s solution, that “international standard”, in a minute. First, picture the scene. Brown, Sarkozy, Merkel and Obama in shining armour at the head of a massed global army beetling over the shores of Grand Cayman/Bermuda/Zurich high street. The siege ladders are ready and the trebuchet is limbering up. Because that is the spectacle the G20 invite us to behold.

One problem for Gordon Brown in declaring war on tax havens is that he’s in charge of lots of them. No less than seven British overseas territories – Anguilla, Bermuda, the British Virgin Islands, the Cayman Islands, Gibraltar, Montserrat and the Turks and Caicos Islands – are on the G20’s grey list of countries that still aren’t complying with the information sharing standard, as Tory MP Sir John Stanley told the Commons recently.

This isn’t a rhetorical point. The Westminster government has complete discretion to intervene in the administration of these territories whenever it wants. In theory, Gordon Brown could tear up the Cayman constitution tomorrow and impose on it a UK-style tax regime.

He won’t, though. Last December Alistair Darling announced a review of Britain’s offshore financial centres to examine the “opportunities and challenges” facing them. The review under former Bank of England director Michael Foot is examining, amongst other things, the territories’ tax regimes, with one eye on what the G20 agreed, according to their interim report. But ministers have already declared that Foot’s review will not lead to any change in the territories’ governance or their tax affairs.

According to Brown (who, to give him credit, has written to the overseas territories about it) and the G20, the way to fix tax havens is to get them to sign up to information-sharing agreements.  If a country’s tax authorities wish to check that companies aren’t evading tax or exploiting legal loopholes, they can write to the authorities asking for information (number of Swiss bank account, amounts of money paid out etc.) The handbook for all this – that “tax standard” mentioned above – comes from the Organisation for Economic Co-operation and Development.

But the OECD only wants information to be available on request, rather than, as tax campaigners and many MPs want, automatically surrendered to the parent countries of the citizens and companies who bank there. To request it, you need their name, knowledge of the taxes in question and preferably knowledge of who holds the information. Tricky, when banking arrangements are shrouded in secrecy.

Finally, whatever money the Treasury can claw back from tax havens, what about those countries who need it even more than we do? The Commons saw a vigorous debate about tax avoidance last week, as Tory, Lib Dem and Labour MPs queued up to attack the government’s approach. Among them was Vince Cable, who highlighted a Christian Aid report suggesting that developing countries lose $157 billion to tax avoidance every year. Treasury minister Ian Pearson promised that the Department for International Development – which of course pays out aid to the same countries – is conducting a review on that very subject, to report “imminently”.

What happened to the G20’s siege ladders and trebuchet? Tax campaigners may well argue that they were waved around for the media before being packed away. The DFID report may yet change their minds – whether it influences No 10 and No 11 is another matter.